Analyst view on Nevada order
YUKON-NEVADA GOLD CORP.
($1.66: YNG-TSX)
Recommendation: Speculative Buy (Unchanged)
Target Price: $3.30 (I-Year); $5.90 (3-Year)
RECENT DEVELOPMENT: STOP ORDER AFFECTS PRODUCTION AT JERRITT
In what appears to be a case of miscommunication, the State of Nevada, Division of Environmental Protection (“NDEP”)
has issued a cease production order to Yukon-Nevada’s Jerritt Canyon roasters. The order results from a failure of Yukon-
Nevada to install instrumentation necessary to monitor emission control systems. However, the Company is currently in
the midst of a planned shutdown to install the necessary equipment, which was not communicated to NDEP.
Once installation is complete, there will be a calibration and testing phase, which could result in delays to the restart.
The Company’s planned outage was to last for two weeks. This timing is diffi cult to gauge at this point, but management
fi rmly believes there will be no impact on the expected production of 120,000 ounces of gold in 2008, from the Company’s
own ores. This confi dence stems from the fact that the Company’s milling facility has excess capacity, so that any lost
production should be made up later on.
The cease production order is not related to the Company exceeding emissions limits, as was incorrectly reported by
certain media.
COMMENT: Although the Company believes that its existing emission-controlled system meets the regulatory emission
standards, it has to be tested and approved by the NDEP. Should the department not approve it, the company would have
to install the new system that is required by the state regulation.
THE COMPANY
Yukon-Nevada Gold Corp. is a gold producer involved in the exploration, development and operation of gold deposits.
The company has a diverse portfolio of properties and commodities.
RECOMMENDATION
We continue to rate Yukon-Nevada shares as a Speculative Buy, with Target Prices of $3.30 (1-Year) and $5.90 (3-Year).
The shares are suitable for risk-tolerant investors.